BlackBerry actually posted a surprise profit in its fourth-quarter earnings release on Friday with earnings of 4 cents a share, which beat the consensus estimate of a loss of 4 cents a share.
But the company missed on revenue, with a 32% year-over-year decline to $660 million. Analysts had expected $778 million.
Credit Suisse issued a bearish note on the stock Monday and noted its belief that the company would continue to "burn cash." The firm said the best course of action for BlackBerry would be to break up.
"Given the inherent challenges in turning around the services stream, and subscale loss-making hardware business, we believe it would be best for the company to break up," the firm wrote in a research note. "Assuming shutting down the hardware business by the end of FY16 and winding down services business by the end of FY17, we arrive at NAV of $3.2bn ($6 per share), which approximate 37% downside from the current market price."
The firm has an "underperform" rating and $6 price target on the stock.
Insight from TheStreet's Research Team
Brian Sozzi commented on BlackBerry in a recent post on RealMoney.com. Here is what Sozzi had to say about the stock:
Sticking with the losers, how completely irrelevant is Blackberry's BMM messaging service on iOS, given the new messaging capabilities on the Apple Watch? I can't share my heartbeat with my hot girlfriend (disclosure: I am single) on Valentine's Day via BBM! Moreover, how could Blackberry sustain its odd popularity of late with classic phone designs, when people will want to sync their Apple Watch to an iPhone 6 plus, in order to create an efficient life on Earth? Looming bigger screens on Apple tablets destined for offices, plus the existence of the Apple Watch, should allow the company to capture further share of Blackberry's corporate stronghold over the next three years.
Want more information like this from Brian Sozzi BEFORE your stock moves? Learn more about RealMoney.com now.
Separately, TheStreet Ratings team rates BLACKBERRY LTD as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation:
"We rate BLACKBERRY LTD (BBRY) a SELL. This is driven by a number of negative factors, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The area that we feel has been the company's primary weakness has been its relatively poor performance when compared with the S&P 500 during the past year."
You can view the full analysis from the report here: BBRY Ratings Report